Govt proposes Rs 1,345 crore Rare Earth Magnet scheme, forms inter-ministerial commitee

The Ministry of Heavy Industries has floated a proposal for a Rare Earth Magnet Processing Scheme for inter-ministerial consultations, aimed at boosting domestic production and reducing import dependency on critical magnet components used in electric vehicles, electronics, and renewable energy technologies.

“We have floated the rare earth magnet processing scheme for inter-ministerial consultations,” said Kamran Rizvi, Secretary, Ministry of Heavy Industries.

Union Minister for Heavy Industries H D Kumaraswamy confirmed that the proposed scheme has a financial allocation of ₹1,345 crore. The scheme is part of the government’s broader effort to strengthen India’s manufacturing capabilities in strategic materials and components.

Rare earth magnets, particularly neodymium-based magnets, are crucial for high-performance motors used in electric mobility, wind turbines, and defense applications. India currently imports most of its rare earth magnets, despite having significant rare earth reserves.

The proposed scheme is expected to include incentives for manufacturers, promote R&D and technology partnerships, and encourage private sector investment to build a domestic supply chain for magnet production.